Why Your Agency Is Losing Value And What You Can Do About I Part 9 of 10
*This article is part of a continuing series about how to maintain and grow the value of your insurance agency so it will hopefully be worth more tomorrow than it was yesterday. In this entry we cover the importance of professional and consistent Marketing and why it will add value to your agency.
One day you decide to take some chips off the table, ease into retirement, buy that island near Tahiti you’ve had your eye on, so you talk to a prospective buyer about selling your agency. I guarantee one of the very first questions that buyer will ask you: “How do you get your business?”
If you can answer by describing a consistent, multi-faceted, and monitored marketing strategy with statistics about which methods have worked best and why, you will have just substantially increased the value of your agency.
The only problem is, independent insurance agents do a terrible job of marketing. So chances are if you were talking to that hypothetical buyer today, your answer would be something like: “Well, you know…um, we get people calling in and…some cross-sells, usually…but a lot of referrals, or I guess maybe not a lot but definitely…uh, a few people from my church, um…”.
That’s not a marketing strategy. That’s crossing your fingers and hoping the phone rings today.
Insurance agents don’t invest in marketing because they have no idea whether or not it’s working. Plain and simple. There are MANY ways to figure out whether your marketing investment is working or not, but most agents just don’t understand it, so they don’t do it. The agencies that are actively marketing are growing in value. Plain and simple. And not just by increasing their current income but by positioning the asset of their agency for solid future value.
You shouldn’t confuse marketing as just being advertising. But advertising is one form of marketing. Marketing is the message or impression you put forth in every single direct or indirect interaction with a client, prospect, or the general public. And marketing is not just for the purpose of attracting new business, but presenting a consistent and professional image to your existing clients in order to keep them on the books and generate more business from them.
Consistency is critical in any marketing effort. If your agency has a logo (and if it doesn’t, it should), you don’t want that logo to be bright yellow on your store-front sign, blue on your envelopes, and red on your website. You probably think that’s common sense, but think about every other example of the “message or impression you put forth” with your clients…are they consistent? Does everyone in your agency answer the phone the exact same way, using the exact same words? Or do some people just say, “Insurance” while other people say, “Thank you for calling Acme Insurance. How may I help you today?” That’s marketing. Do the emails you and your people send to clients and prospects all have the exact same signature block that lists your name, company name, phone number, website address, and a nice marketing message like, “We can save you up to 20% by combining your Auto and Home policy with the same carrier”? Or does Suzie’s email signature have the Oakland Raiders logo in it and Maria’s signature uses a font that has cute curly-cues and bunny rabbits? That’s marketing.
In today’s competitive insurance environment, more effort and investment needs to go toward digital marketing. That means your agency website, assuming you have one (and if you don’t, you should) needs to be fresh, interactive, and loaded with links and keywords that will attract attention from the search engines when people are looking for insurance. Internet marketing doesn’t mean just having a website. If nobody can find your website, what’s the point? You also need to have a presence on social media sites, do blogging on and off your website, create videos, send messages on Twitter, announcements on Linked-In, invitations on Facebook. That’s marketing.
Today, 85% of consumers start their shopping for insurance in one place: the Internet. You can doubt that’s true and keep praying for your phone to ring or you can think of your own shopping behaviors and translate them to how other consumers are also shopping.
If you had to replace the computer you’re reading this on right now, would you just get up from your chair, drive your car to the nearest electronics store, and pick up whatever they had? No, you wouldn’t. You would first go online, do a search for the type of computer you wanted, look at a few different options, and get an understanding of the different price ranges and capabilities. Then after that, you might drive to the local electronics store armed with some knowledge and find the one that was right for you. People shopping for insurance are doing the exact same thing.
The reality is, with today’s consumer, the guy who lives in the house next door to your agency is much more likely to buy insurance from you because he found you online, than because he walks past your office each morning. That’s a fact.
And digital marketing doesn’t end with the Internet. It includes using digital means to deliver a consistent message and impression to your existing clients, via e-mail. How many times have you proactively communicated with your existing clients since they bought something from you? Most people can’t even remember who their agent is, especially in a direct bill situation, because every communication they get is direct from the carrier. You need to have periodic interaction with your clients, inform them of changes, make sure they understand you offer other lines, and solicit their business on those other lines. Doing it automatically and electronically is the easiest way to ensure it’s consistent and it’s tracked for responses and results. That’s marketing.
Once you understand the methods and value of measuring and tracking, then you will understand the importance of having a solid marketing plan that drives business from new places and from existing clients, and you will be adding considerable current and future value to your insurance agency.
Jerry Pickett is VP of Mergers & Acquisitions/Client Consulting with Agency Acquisitions – an Astonish Results Company (www.AgencyAcquisitions.com). Agency Acquisitions works with agency owners to help maximize the value of their agency, perform agency valuation analysis, and handle all aspects of acquisition transactions for sellers and buyers of insurance agencies. Contact Jerry @ or email: email@example.com